After Hours Action: NVIDIA, AMD, Alcoa and Apollo

Although shares of Advanced Micro Devices closed higher on a bullish analyst call, they sold off sharply in extended trade when word hit that Chief Executive Dirk Meyer had resigned and would be replaced by Chief Financial Officer Thomas Seifert while the chipmaker searches for a permanent replacement.

The change will accelerate AMD's ability to "establish market leadership and generate superior financial returns," said a statement by Bruce Claflin, the chairman of AMD's board of directors.

AMD also said its fourth quarter revenue increased 2 percent sequentially to $1.65 billion, with gross profit margin of roughly 45 percent. The company is scheduled to deliver full fourth quarter results on Thursday.

AMD is the No.2 maker of PC microprocessors, behind Intel, whose chips are used in more than 80 percent of the world's PCs.

What’s the take away?

Historically when a CEO resigns, it’s not a good thing, says Karen Finerman. Typically investors assume the worst until they hear otherwise.

We may see a little hit, admits Joe Terranova, but longer term I like this stock.

In extended trade Nvidia's shares jumped more than 6% after the company said Intel would pay graphics chip designer Nvidia a $1.5 billion licensing fee, settling a legal dispute over a license to make chipsets.

Under the agreement, Intel, the world's largest microchip maker, will be allowed to use some patents belonging to Nvidia.

For-profit colleges such as Apollo's University of Phoenix have come under fire for burdening students with debt without training them properly for the workplace.

What’s the takeaway?

Sometimes the best trade is no trade, says Joe Terranova. There is so much volatility in this space, I just think there are better places to put money to work.

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AFTER HOURS ACTION: ALCOA

After hours, Alcoa kicked off earnings season with a bang. The aluminum giant reported a profit that jumped from last year and surpassed what Wall Street was expecting as aluminum prices rose in the year's final quarter after two years of weakness.

The company said it earned 21 cents a share in the fourth quarter excluding one-time items, compared with 1 cent a share last year.

Analysts who follow Alcoa on average expected the company to turn in a profit of 19 cents a share on sales of $5.7 billion.

"The good news is growth—if you look at it from a year ago, we've grown revenues by 14 percent," Alcoa Chairman and CEO Klaus Kleinfeld told CNBC Monday. "All of that is nice...I think we have a nice momentum."

The chief executive said he sees growth continuing from emerging economies such as India and Vietnam.

"They will accelerate their growth, and that makes us believe we are going to have another great year for aluminum growth, and 12 percent is our number," Kleinfeld said.

He said he sees growth from China slowing, however: "We actually do see from a regional perspective China is slowing down a little bit—we saw China grow 21 percent in 2010, we think it's going to come out at 15 percent."

In terms of the domestic market, Kleinfeld said Alcoa has seen "quite a bit of stabilization" in the United States.

"I'm more optimistic on the U.S. than I've seen most of analysts out there. And that is driven by quite a number of factors—just look at automotive sales in December," he said.

Alcoa's performance in the fourth quarter came despite exchange rates that worked against the company, Kleinfeld said.

"We've seen quite a bit going against us this year" in terms of currencies, he said. "What you can see in the numbers is we have been able to compensate for that."

What’s the trade?

If you’re looking for an aluminum trade take a look at Moscow-based RusAl, says Joe Terranova.

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CAN YOU HEAR IPHONE NOW?

Apple hit fresh all time highs in anticipation of Verizon’s iPhone announcement on Tuesday.

What’s the trade?

I think Verizon will pop on the news but gains may be short lived if they’re faced with pricing challenges to compete, says Jon Najarian. I suspect they’ll have to offer unlimited data to win business away from rival with AT&T.

I think the path for Apple will be almost straight up to $400, adds Joe Terranova. And I suspect the loser here will be Sprint.

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For Joe Terranova Terranova is Chief Market Strategist of Virtus Investment Partners, LTDVirtus Investment Partners Owns More Than 1% Of (ABAX)Virtus Investment Partners Owns More Than 1% Of (AMKR)Virtus Investment Partners Owns More Than 1% Of (CCG)Virtus Investment Partners Owns More Than 1% Of (CASS)Virtus Investment Partners Owns More Than 1% Of (CSVI)Virtus Investment Partners Owns More Than 1% Of (EXR)Virtus Investment Partners Owns More Than 1% Of (FCFS)Virtus Investment Partners Owns More Than 1% Of (IGE)Virtus Investment Partners Owns More Than 1% Of (KRC)Virtus Investment Partners Owns More Than 1% Of (LDR)Virtus Investment Partners Owns More Than 1% Of (LPHI)Virtus Investment Partners Owns More Than 1% Of (NCRI)Virtus Investment Partners Owns More Than 1% Of (DBV)Virtus Investment Partners Owns More Than 1% Of (XLB)Virtus Investment Partners Owns More Than 1% Of (XLV)Virtus Investment Partners Owns More Than 1% Of (XLP)Virtus Investment Partners Owns More Than 1% Of (XLY)Virtus Investment Partners Owns More Than 1% Of (XLE)Virtus Investment Partners Owns More Than 1% Of (XLI)Virtus Investment Partners Owns More Than 1% Of (XLK)Virtus Investment Partners Owns More Than 1% Of (XLU)Virtus Investment Partners Owns More Than 1% Of (SUBK)Virtus Investment Partners Owns More Than 1% Of (WDFC)Virtus Investment Partners Owns More Than 1% Of (YDNT)Virtus Investment Partners Owns More Than 1% Of (CLB)

For Brian KellyAccounts Managed By Kanundrum Capital Own (TBT)Accounts Managed By Kanundrum Capital Own (YGE)Accounts Managed By Kanundrum Capital Own (FCX)Accounts Managed By Kanundrum Capital Own (MON)Accounts Managed By Kanundrum Capital Own (ANDE)Accounts Managed By Kanundrum Capital Own (GLD)Accounts Managed By Kanundrum Capital Own (JPM) putsAccounts Managed By Kanundrum Capital Are Long USDAccounts Managed By Kanundrum Capital Are Short The EuroAccounts Managed By Kanundrum Capital Are Short The YenAccounts Managed By Kanundrum Capital Are Short (XLF)

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